We use cookies to give you the best experience possible. By continuing we’ll assume you’re on board with our cookie policy

Stock Price Essay

Sorry, but copying text is forbidden on this website!

1. If you bought a share of stock, what would you expect to receive, when would you expect to receive it, and would you be certain that your expectations would be met? 2. If most investors expect the same cash flows from Companies A and B but are more confident that Company A’s cash flow will be close to their expected value, which should have the higher stock price? Explain. 3. When is a stock said to be in equilibrium? At any given time, would you guess that most stocks are in equilibrium as you defined it? Explain.

4. Suppose three completely honest individuals gave you their estimates of Stock X’s intrinsic value. One is your current girlfriend or boyfriend, the second is a professional security analyst with an excellent reputation on Wall Street, and the third is Company X’s CFO. If the three estimates differ, which one would you have the most confidence in? Why? 5. What are some actions stockholders can take to ensure that management’s and stockholders’ interest can be aligned? 6. The president of Southern Semiconductor Corporation (SSC) made this statement in the company’s annual report: “SSC’s primary goal is to increase the value of our common stockholders’ equity.” Later in the report, the following announcements were made: (a) The company is spending $500 million to open a new plant and expand operations in China.

Do you need to write an essay on Stock Price ? We can help!

get started

No profits will be produced by the Chinese operation for 4 years, so earnings will be depressed during this period versus what they would have been had the decision not been made to expand in the market. (b) The company holds about half of its assets in the form of U.S. Treasury bonds, and it keeps these funds available for use in emergencies. In the future, though, SSC plans to shift its emergency funds from Treasury bonds to common stocks. Discuss how SSC’s stockholders might view each of these actions, and how they might affect the stock price.

7. Edmund Enterprises recently made a large investment to upgrade its technology. While these improvements won’t have much of an effect on performance in the short run, they are expected to reduce future costs significantly. What effect will this investment have on Edmund Enterprises’ earnings per share this year? What effect might this investment have on the company’s stock price? 8. What agency relationships exist within a corporation? 9. What mechanisms exist to influence managers to act in shareholders’ best interests? 10. Should shareholders (through managers) take actions that are detrimental to bondholders? 11. What factors affect stock prices?

How to cite this page

Choose cite format:

Stock Price. (2016, Oct 08). Retrieved from https://studymoose.com/stock-price-essay

We will write a custom sample essay onStock Pricespecifically for you

for only $16.38 $13.90/page
Order now

Our customer support team is available Monday-Friday 9am-5pm EST. If you contact us after hours, we'll get back to you in 24 hours or less.

By clicking "Send Message", you agree to our terms of service and privacy policy. We'll occasionally send you account related and promo emails.
No results found for “ image
Try Our service

Hi, I am Sara from Studymoose

Hi there, would you like to get such a paper? How about receiving a customized one? Click to learn more https://goo.gl/CYf83b


Hi, I am Sara from Studymoose

Hi there, would you like to get such a paper? How about receiving a customized one? Click to learn more https://goo.gl/CYf83b


Your Answer is very helpful for Us
Thank you a lot!